Saved Bookmarks
| 1. |
Production Possibility Frontier is:A. Downward SlopingB. Concave ShapedC. Both (a) and (b)D. Either (a) or (b) |
|
Answer» Correct Answer - C The two basic characteristics or features of PPF are:1. PPF slopes downwards:PPF shows all the maximum possible combination of two goods, which can be produced with the available resources and technology. In such a case, more of one good can be produced only by taking resources away from the production of another good.2. PPF is Concave Shaped:PPF is concave shaped because of increasing marginal opportunity costs, i.e. more and more units of one commodity are sacrificed to gain an additional unit of another commodity. |
|